Health Insurance #1

How much is an agent's appointment fee?

$5

how much is an agents appointment fee?

$5

An insured has a major medical policy with a $500 deductible and 80/20 coinsurance. The insured is hospitalized and sustains a $2500 bill. What is the maximum amount the insured will have to pay.

$900. The insured will pay the 500 deductible plus the 20% of the remaining bill. $2500-500= 2000x 20%= 400. 400+500=900.

What is the maximum period that an insurer would pay benefits inaccordance with an Additional Monthly Benefit Rider?

1 year.

An insured pays a monthly premium of $100 for her health insurance. What would be the duration of the grace period under her policy?

10 days. The grace period is 7 days if paid weekly, 10 days if paid monthly and 31 days for all other modes.

In a noncontributory health insurance plan, what percentage of eligible employees must participate in the plan before the plan can become effective?

100%

An employee insured under a group health plan has been paying $25 monthly premium for his group health coverage. The employer has been contributing $75 for a total monthly cost of $100. If the employee leaves the company, what would be his maximum monthly premium?

102. The employer is permitted to collect a premium from the terminated employee at a rate of no more than 102% of the individual's group premium rate. The 2% charge is to cover the employer's administrative costs.

When a group health insurance plan is terminated, How long is an extension of benefits provided for any totally disabled employee or dependent?

12 months

To be eligible under HIPPA regulations, for how long should an individual converting to an individual health plan have been covered under the previous group plan?

18 months.

An insured was involved in a accident and could not perform her current job for 3 years. If the insured could reasonably perform another job utilizing similar skills after one month, for how long would she be receiving benefits under "own occupation" disability plan?

2 years. Under own occupation plans, if the insured cannot perform her current job for a period of up to two years, disability benefits will be issued, even if the insured would be capable of performing a similar job during that two-year period.

COBRA applies to employers with at least

20 employees

The patient protection and affordable care act mandates that insurers provide coverage for adult children of the insured up to the age of:

26

According to the Time Limit on Certain Defenses provision, non-fraudulent misstatements made on the health insurance application may not be used to deny a claim after the policy has been in force for

3 years. In Michigan, the time limit for certain defenses is 3 years.

If a new individual long-term care policyholder is not satisfied with a new policy, within how many days can the insured return the policy for a full premium refund?

30 days.

The Omnibus Budget Reconciliation Act of 1990 requires the employer health plan to provide primary coverage for individuals with end-stage renal disease before Medicare becomes primary for how many months?

30 months.

The omnibus budget reconciliation act of 1990 requires the employer health plan to provide primary coverage for individuals with end-stage renal disease before Medicare becomes primary for how many months?

30 months.

What is the period of coverage for events such as death or divorce under COBRA?

36 months

A Medicare Supplement policy must provide coverage for pre-existing conditions after the policy has been in force for

6 months. Pre-existing conditions must be covered after a policy has been in force for 6 months.

How many eligible employees must be included in a contributory plan?

75%

What is a Combination Dental Plan?

A combination plan is a combination of the scheduled and nonscheduled plan. The combination plan covers diagnostic and preventative services on the usual, customary and reasonable basis but uses a fee schedule for other dental services.

Which of the following groups seeking group health insurance would represent a bad risk for underwriters?

A group that changes insurance annually. The underwriter takes persistency into consideration because groups that change insurance companies every year do not represent a good risk

What is a material misrepresentation?

A statement by the applicant that, upon discovery, would affect the underwriting decision of the insurance company.

What company produces evaluations of insurer financial status often used by the Insurance Department?

AM Best assigns ratings to life, property and casualty insurance companies.

What type of coverage is usually provided under a blanked disability policy?

Accident only

What kind of LTC benefit would provide coverage for care for funtionally impared adults on a less than 24-hour basis?

Adult Day Care

How can a new physician be added to the PPOs approved list?

Agree to follow the PPO Standards and charge the appropriate fees.

In which Medicare supplemental policies are the core benefits found?

All plans. The benefits in Pan A are considered to be core benefits and must be included in the other types.

In reference to the standard Medicare Supplement benefit plans, what does the term "standard" mean?

All providers will have the same coverage options and conditions for each plan.

Which of the following statements is true concerning the alteration of optional policy provisions?

An insurer may change the wording of optional provisions, as long as the change does not adversely affect the policyholder.

An agent accepts the premium payment 35 days after it is due, telling the insured that there will not be a problem keeping the policy in force. This is an example of what time of agent authority?

Apparent

How long does an insurer have to contest fraudulent misstatements made in a health insurance application?

As long as the policy is in force. Fraudulent misstatements can be contested at any time.

Occasional visits by which of the following medical professionals will NOT be covered under LTC's home health care?

Attending physician.

The agent is know as the "Field Underwriter" because of the information he/she gathers for the insurer. This helps the insurer: Reduce the number of staff underwriters; Avoid adverse selection; comply with State law; Learn about the underwriting process.

Avoid Adverse Selection. The writing agent is normally the only insurance company representative that actually sees the applicant

A dental plan that provides coverage based upon a specified maximum scheduled amount for each procedure and pays on a "first dollar" basis with no deductible or co-insurance is a

Basic or Scheduled plan

In comparison to a policy that uses the accidental means definition, a policy that uses the accidental bodily injury definition would provide a coverage that is: More limited in general; more limited in duration; broader in general; broader in duration

Broader in general

Which of the following could be used when a corporation, association, partnership or limited liability partnership acts as a producer?

Business entity means a corp, assic. part. llc, llp or legal entity.

After a person's employment is terminated, it is possible to obtain individual health insurance after losing the group health coverage provided by the employee. Which of the following is NOT true?

By law, the new, individual policy must provide the same benefits as the group insurance policy. (Terminated employees have 31 days to convert to an individual health insurance policy, without having to provide proof of insurability. The insurer can adjust the new policy's premium as it sees fit. The new policy could offer lesser benefits that the original group health policy.

Kevin and Nancy are married; Kevin is the primary breadwinner and has a health insurance policy that covers both him and his wife. Nancy has an illness that requires significant medical attention. Kevin and Nancy decide to legally separate, which means that Nancy will no longer be eligible for health insurance coverage under Kevin. Which of the following options would be best for Nancy at this point?

COBRA

A health insurance plan that covers all accidents and sicknesses that are not specifically excluded from the policy is referred to as a

Comprehensive Plan

What term best describes the act of withholding material inforamtion that would be crucial to an underwriting decision?

Concealment

Which of the following is NOT true of basic medical expense plans?

Coverage for catastrophic medical expenses.

What is an important feature of a dental expense insurance plan that is not typically found in a medical expense insurance plan?

Diagnostic and preventive care

A producer misrepresents the details of an insured's new insurance contract that will be replacing the current contract. Which of the following is the producer violating?

Errors and omissions liability

What are the authorities an agent can hold

Express and implied

Which of the following is NOT a government insurance program? Old-age, Survivors and Disability Insurance; Medicare, Medicaid, FDIC

FDIC

As it pertains to group health insurance, COBRA stipulated that

Group covereage must be extended for terminated employees up to a certain period of time at the former employees expense.

A new employee who meets HIPAA eligibility requirements must be issued health coverage on what basis?

Guaranteed

Events or conditions that increase the chances of an insured loss occurring are referred to as:

Hazards

An Insurer devises an intimidation strategy in order to corner a large portion of the insurance market. Which of the following best describes this practice?

Illegal

A health insurance policy lapses, but is reinstated within an acceptable timeframe. How soon from the reinstatement date will coverage for accidents become effective?

Immediately

which of the following factors about the insured determines the amount of disability benefit that the insured will receive?

Income

The Affordable Care Act includes all of the following provisions EXCEPT

Individual tax deduction for premiums paid

When agents are acting within the scope of their contract, their actions will be assumed to be the acts of the ?

Insurer

Which of the following entities has the authority to make changes to an insurance policy?

Insurer's executive officer

Which document is used to assess risk associated with an applicant's lifestyle and character?

Investigative Consumer Report

Which of the following is true regarding health insurance?

It could provide payments for loss of income. Health Insurance is a generic term, encompassing several types of insurance contracts, which, though related, are designed to protect against different risks. It provides coverage for expenses related to health care, loss of income and disbility income.

An association could buy group insurance for its members if it meets all of the following requirements EXCEPT

It has 50 members. (It must have at least 100 members)

All of the following statement describe a MEWA except:

MEWAs are groups of at least 3 employers. MEWAs are groups of at least 2 employers who pool their risks to self-insure. MEWAs can be sponsored by and insurance company, an independent administrator or another group established to provide group benefits for participants.

Which of the following information regarding an insured is NOT included in an Investigative Consumer Report, which is requested by and underwriter?

Medical History

An insurance company wants to obtain the insurance history of an applicant. Which source releases coded information to insurers regarding information included on previous insurance applications?

Medical Information Bureau. This information alone cannot be used to justify declining a risk, but is helpful in providing insurers with information.

Under an individual disability policy, the MINIMUM schedule of time in which claim payments must be made to an insured is

Monthly.

Premium payments for personally owned disability income policies are

NOT tax deductible.

When may an insurer require an insured to provide genetic information?

Never

In an individual long-term care insurance plan, the insured is able to deduct the premiums from taxes. What income taxation will be imposed on the benefits received?

No Tax.

Who is involved in completing he agent's report?

Only the agent

Which of the following factors would be a underwriting consideration for a small employer carrier?

Percentage of participation. Coverage under a small employer health benefit plan is generally available only if at least 75% of eligible employees elect to be covered.

According to the PPACA Metal Levels Classification, if a health plan is expected to cover 90% of the cost for an average population, and the participants would cover the remaining 10%, what type of plan is that?

Platinum (Bronze level benefit pays 60% of expected health care costs; silver level pays 70; gold pays 80%; and platinum pays 90%)

Which of the following is the most common time for errors and omissions to occur on the part of an insurer?

Policy delivery & sales interview

Which of the following is not a ratings classification that denotes the level of risk associated with a given insured?

Poor. The three ratings classifications are standard, substandard, and preferred.

Which of the following do the Standard and Preferred risk categories share?

Premiums are not elevated

An underwriter may reject an application for health insurance if the rejection is based upon which of the following?

Prescription coverage

Certain conditions, such as a dismemberment or total and permanent blindness, will automatically qualify the insured for full disability benefits. which disability policy provision does this describe?

Presumptive disability. (A presumptive disability is a provision that is found in most disability income policies which specifies the conditions that will automatically qualify the insured for full disability benefits.

Risk of loss may be classifield as

Pure risk and speculative risk

Which of the following is NOT provided by an HMO

Reimbursement

Which of the following best details the underwriting process for life insurance?

Selection, classification, and rating of risks

Which of the following are responsible for making premium payments in an HMO Plan?

Subscribers. Subscribers are the people in whose name the contract is issued. They would be responsible for making premium payments.

Which act amended the National Labor Relations Act?

Taft-Hartley

Which of the following is an example of apparent authority of an agent appointed by an insurer?

The agent accepts a premium payment after the end of the grace period.

All of the following are ways in which a Major Medical Policy premium is determined EXCEPT?

The average age of the group.

Which of the following is NOT a characteristic of a group long-term disability plan?

The benefit can be up to 50% of one's yearly income

Which of the following is not a characteristic of a group long-term disability plan?

The benefit can be up to 50% of one's yearly income. (the Maximum is based upon monthly income)

Anna loses her left arm in an accident that is covered by her Accidental Death and Dismemberment policy. What kind of benefit will Anna most likely receive from this policy?

The capital amount in a lump sum. (a percentage of the principal amount) for the loss of 1 limb or loss of sight in 1 eye. The principal amount is paid for death, or for the loss of 2 limbs or loss of sight in both eyes. Benefits are paid in a lump sum.

which of the following statements concerning group health insurance is correct?

The employer is the policyholder

Which statement accurately describes group disability income insurance?

The extent of the benefits is determined by the insured's income. ( Group plans usually specify the benefits based on a percentage of the worker's income. Short-term group plans usually provide maximum benefit periods of 13-26 weeks. Group long-term plans provide monthly benefits usually limited to 60% of the individuals income. Group disability plans also have a minimum participation requirements - usually the employee must have worked for 30-90 days before becoming eligible for coverage.

An employee insured under a group health policy is injured in a car wreck while performing her duties for her employer. This results in a long hospitalization. Which of the following is true?

The group plan will not pay because the employee was injured at work.

Which is NOT true regarding an insured who is considered to be a standard risk?

The insured may have to pay slightly higher premiums.

A man is enrolled in Part A of Medicare and not Part B. Three months into coverage, he applies for a Medicare supplement policy. Which of the following is true?

The insurer can deny coverage.

Which of the following is NOT a feature of a guaranteed renewable provision?

The insurer can increase the policy premium on an individual basis.

Who must pay for the cost of a medical examination required in the process of underwriting?

The insurer.

which of the following is true regarding underwriting for a person with HIV?

The person may be declined. The HIV consent form provides the insurance company with authorization to test for the presence of the HIV virus and applies to all life and health policies issued in this state.

Which of the following is true regarding benefits paid to disabled employees?

They may be subject to taxation if the premium was paid by the employer. (Any portion of the benefit paid for and deducted by the employer will be considered taxable income to the employee)

Which of the following is NOT the purpose of HIPAA?

To provide immediate coverage to new employees what had previously been covered for 18 months. HIPAA does not prohibit employer from establishing waiting periods or pre-existing condition exclusions.

What is NOT the responsibility of an insurance agent?

Underwriting the contract

Under the physical exam and Autopsy provision, how many times can an insurer have the insured examined, at its own expense, while a claim is pending?

Unlimited

What is a statement that is guaranteed to be true, and if untrue, may breach an insurance contract?

Warrenty

how soon following the occurrence of a covered loss, or after the insurer becomes liable for periodic payments for income benefits, must an insured submit written proof of such loss to the insurance company?

Within 90 days or as soon as reasonably possible but not to exceed a year.

Can an individual who belongs to a POS plan use an out-of-network physician?

Yes, and they may use any preferred physician, even if not part of the HMO.

The type of company organized to return any surplus money to their policyholders is

a mutual insurer

The commissioner may waive prelicensing requirements or examinations for someone who has been a licensed insurance producer

in the preceding 12 months

The causes of loss insured against in an insurance policy are.

perils